THE RPA-STRONGPOINT PARTNERS APPROACH TO SECURE REGULATIONS
The SECURE 1.0 and SECURE 2.0 (“SECURE”) legislation marks the largest reform in retirement plans in over fifty years, dating back to the changes made by ERISA. With over 90 provisions, SECURE impacts virtually all types of retirement plans.
Since the effective dates of the Act’s provisions are wide-ranging, some provisions are already in effect and others will become effective between 2025 and 2028. Here we aim to provide you with an overview of how RPA and Strongpoint Partners plan to implement these provisions into our plan processes and operations. While we have seen some IRS guidance since the enactment of this legislation, there is still much to come before certain provisions can be implemented with confidence and efficiency.
Understanding SECURE 2.0:
SECURE 2.0 builds upon the foundation laid by SECURE 1.0, with many changes that generally align with the same broad categories, including:
Simplification and clarification of existing retirement plan rules
Expanding coverage
Increasing retirement savings
Preserving retirement income
We hope that by looking at these provisions by categories, it will help plan sponsors focus on those that need attention now and understand how they may benefit and impact your plan.
Our Approach:
We are looking at these based on the following categories:
Mandatory Provisions: they require no decision by plan sponsors but do require understanding and implementation by plan sponsors, and assistance from your third-party administrator to ensure compliance.
Recommended Optional Provisions: These are optional, and, we believe, are in the best interest of most plan sponsors and participants, and we recommend implementing.
Non-Recommended Optional Provisions: These are optional provisions that we do not recommend at this time. This could be due to insufficient guidance; most recordkeepers and custodians are not endorsing them on their platforms, or the administrative burdens appear to outweigh their benefits.
The intricacies of these provisions make this legislation a mixed bag of both welcomed changes, as well as some that further complicate already complex technical rules. In October, we will reach out to clients to request elections on whether to accept our default provisions or to request additional optional provisions. Attached is a preview of these provisions with our recommendations.
Please note, you can also find more complete details and categorization of all SECURE 2 regulatory proposals and guidelines on our SECURE 2.0 website at https://www.strongpointpartners.com/secure-2.
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